NetBank outage hit CIO's pay

NetBank outage hit CIO's pay

Summary: Commonwealth Bank of Australia's extended internet banking outage earlier this year affected the remuneration of its top technology tsars, including chief information officer Michael Harte, the executive revealed today.

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TOPICS: Outage, Banking
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Commonwealth Bank of Australia's extended internet banking outage earlier this year affected the remuneration of its top technology tsars, including chief information officer Michael Harte, the executive revealed today.

Nick Holdsworth, Tim Whiteley, Michael Harte and Dave Curran
(Credit: Suzanne Tindal/ZDNet.com.au)

"It affected mine. And it affected a lot of people in this room," he said — the head of online Tim Whitely; head of core banking, Dave Curran; and lead man for the Telstra telecommunications project Nick Holdsworth were all participating in a press briefing this afternoon.

In the bank's annual report which came out today, it was revealed that Harte netted $2,776,651 in total this year for his services. $1,200,000 was short-term bonuses, and around $500,000 was long-term incentive payment. This compared to $2,694,410 in total pay the year before, $1,300,000 as a short-term bonus and just under $300,000 in long-term incentives. It is unclear whether the effects of the outage was included in this year's pay or not.

NetBank went down at the end of June as unprecedented levels of traffic, a higher than usual percentage of which was suspected to be malicious, put strain on the bank's systems. Customers trying to complete banking for the end of the financial year could do nothing but wait, causing widespread displeasure.

Harte and his team paid for that outage as part of the bank's new focus on customer satisfaction, making it a key performance indicator for 40 per cent of at risk pay for employees within the enterprise services team.

"That simply means that if our customers aren't happy with the reliability of the system, the convenience and ease of use and access, the richness and features and functions, we will be penalised, and our staff will directly feel that," he continued. Conversely, the team would be given an incentive for high levels of satisfaction.

It wasn't just the Commonwealth Bank employees who needed to carefully watch customer satisfaction levels. The bank has decided to make its suppliers meet the same criteria.

"We're increasing that right throughout our supply chain," Harte said. Telstra was one public example of a company which had gone along, but it wasn't just the telco. "Everyone from SAP and Accenture through to Oracle and IBM," Harte explained.

Harte said having customer satisfaction as a KPI was necessary to deliver the right outcome and not just go through the motions. "No one within the organisation is particularly reliable in the way they conduct their affairs ... if they're not personally on the hook," he said.

Holdsworth said that having suppliers vested in customer satisfaction changed the way those organisations made decisions. Instead of "I'm sorry about that problem but we still met our SLA", it became "I'd really like to understand the impact that had on your customers and on your customers and your customers' satisfaction because it had an effect on me".

Topics: Outage, Banking

Suzanne Tindal

About Suzanne Tindal

Suzanne Tindal cut her teeth at ZDNet.com.au as the site's telecommunications reporter, a role that saw her break some of the biggest stories associated with the National Broadband Network process. She then turned her attention to all matters in government and corporate ICT circles. Now she's taking on the whole gamut as news editor for the site.

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7 comments
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  • CBA CIO Pay cut

    I wish I had a job when my flagship software could go down like Netbank did and then I have to suffer a pay cut (sorry, pay increase) of about $100,000. It must be awfully hard for Harte to have to suffer under such hardships.
    My heart bleeds for him (NOT)
    anonymous
  • CIO's Pay

    I am infuriated to think that Harte gets paid MORE than the Prime Minister - or possibly Kerry Packer! or any known australian citizen! What does one need to do to obtain such an EPIC salary and bonuses? how many degrees or how much knowledge does this guy have that entitles him to more than the average human being will earn in a lifetime?
    Lots of butt kissing? Lots of parading around in a suit and dribbling about profits and how to extort its customers for their financial gain? And while employees get made redundant due "to the financial climate" this sod is wallowing in dollar signs.
    Perhaps Harte should be investing a large proportion of his salary BACK into the business as investment. Ridiculous.
    anonymous
  • RE: CIO's Pay

    Everyone gets paid more than Kerry Packer now... and even if Kerry was getting paid it wouldn't be much use to him any more !
    anonymous
  • R U kidding?

    You don't need degrees and such, you need friends and presence. Being an exec is about Brand and playing the numbers.
    Harte plays the game well (looks good, dresses well, done his media training) and ensures that he has a different set of KPIs every year so he cannot be penalised too often. I am sure he will miss the $15,000 Netbank penalty.
    anonymous
  • Netbank failures

    They are still blaming Netbank failures on DOS attacks when it is all bad design and planning. Just as well the rest of the board and exco at CBA are IT stupid or Harte would be caught out and maybe get his just desserts?
    anonymous
  • kiwi revenge

    just trying to recoup some of the lost billions thru failed investments in ansett and aapt
    anonymous
  • Happy Little Vegimites

    For a bunch of guys that has suffered 'significant' financial penalty they sure do look happy !
    anonymous